May 29, 2013

Many a breakfaster has squirmed when faced with runny yolks. But the 5th U.S. Circuit Court of Appeals has overturned a federal administrative trial court and determined that Elgin Nursing and Rehabilitation Center did not violate certain safety requirements by distributing undercooked eggs to residents.

In a May 17 opinion in Elgin Nursing Rehabilitation Center v. U.S. Department of Human Services, 5th Circuit Judge Jerry E. Smith describes how Texas Department of Aging and Disability investigators visiting the Elgin institution three years ago “observed two breakfast plates with egg yolk ‘smeared around the plate’ ” and concluded that, since the eggs were unpasteurized eggs and soft cooked, they could lead to "serious illness and even death” when eaten.

The opinion notes that the regulators therefore “found Elgin to be in noncompliance" with 42 C.F.R. §483.35(i), which requires facilities such as Elgin to serve food in a “sanitary” manner, and the trial court agreed. But Smith, quoting in part a 1986 decision from the D.C. U.S. Circuit Court of Appeals, states: “Allowing an agency to apply its own interpretation to an otherwise vague regulation in the context of an enforcement proceeding would unfairly surprise the sanctioned party and ‘seriously undermine the principle that agencies should provide regulated parties ‘fair warning of the conduct [a regulation] prohibits or requires.’ ”

Juliann Panagos and Michael Seale, shareholders in the Houston office of Crain Caton & James in Houston who represent Elgin Nursing and Rehabilitation Center, welcomed the ruling. Seale says his client's rights were vindicated. Panagos notes that now their client faces no risk of losing its ability to serve patients covered by Medicaid. She notes that the judges on the 5th panel told them their case was "most fun" of all they heard on the day of its oral arguments. Edmond Dante Anderson III, an attorney in the Office of General Counsel of the U.S. Department of Health and Human Services who represents the regulators, did not immediately return a call seeking comment.